# In the matter of D B Realty Limited CP (IB) No.1196-MB-IV-2022

> NCLT judgment dated 2023-07-04. Citation: TCN-2023-NCLT-05380. Bank of India, the Financial Creditor/Applicant, filed an application under Section 7 of the…

- **Court:** NCLT
- **Order date:** 4 Jul 2023
- **Citation:** TCN-2023-NCLT-05380
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-mumbai/d-b-realty-limited-cp-ib-no1196-mb-iv-2022-a6721ce6

## Summary

### Background

Bank of India, the Financial Creditor/Applicant, filed an application under Section 7 of the Insolvency & Bankruptcy Code, 2016 against D B Realty Limited, the Corporate Debtor, for initiating Corporate Insolvency Resolution Process (CIRP). The application was filed due to a default amount of Rs. 760,38,97,217.87 plus further interest as on 30.09.2022, with the date of default stated as 30.08.2015.

## Facts

Bank of India sanctioned a Term Loan to M/s. Pune Buildtech Pvt. Ltd. (Principal Borrower) for Rs. 225 Cr.

D B Realty Limited extended their guarantee in favour of Bank of India for the Term Loan.

The Term Loan was originally repayable in 21 equal monthly installments commencing from February 2015.

The Principal Borrower could not complete the project and stopped construction work in September 2016 due to shortage of funds.

The account was classified as NPA on 31.12.2015 due to non-payment of interest from August 2015 onwards.

Bank of India issued a Legal Notice on 20.10.2022 invoking guarantee and calling upon D B Realty Limited to repay the outstanding debt.

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## Issues and analysis

### Issue 1: Whether the petition is barred …

**Ratio:** Section 10A of the Code prohibits the initiation of CIRP for defaults occurring during a

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**Reasoning:** The Corporate Debtor argued that the default occurred within the prohibited period under

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**Interpretation:** The NCLT found that the guarantee of the Corporate Debtor was invoked on

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**Application:** The NCLT held that the petition is not

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## Parties

- **Judges:** Prabhat…; KISHORE VEMULAPALL…
- **Appellants:** Bank of…
- **Respondents:** D B Realty…; DB Realty L…
- **Other parties:** Prashant…
- **Advocates:** Zal Andhya…; Karan B…; +2 more

## Timeline

- **2015-08-30 — Date of D…**: Date of Default is stated as…
- **2022-10-20 — Legal No…**: Financial Creditor issued Legal Notice on 20.10.2022 invoking guarantee and calling upon…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 14 — Moratorium](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-14)

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